Southwest suburban Dist 210 former superintendent faces federal fraud charges

CHICAGO — Wednesday, the Northern District of Illinois FBI announced the indictment of the retired superintendent of Lincoln-Way Community High School District 210 on federal fraud charges for allegedly misappropriating school funds for his own benefit and concealing the district’s true financial deficit from the public.

District 210's former superintendent Lawrence Wyllie is accused of using at least $50,000 in school district funds to build and operate Superdog, a dog obedience training school that provided no benefit to the four high schools in the southwest suburban district.

Wyllie, 79, also is charged with misappropriating at least $16,500 of school district funds by paying himself a retirement stipend that was not in his employment contract. Wyllie fraudulently pocketed another $14,000 of school district funds by falsely describing it as compensation for unused vacation days – another benefit that was not in his contract, the charges state.

Wyllie is also accused of inflating the district’s financial health by using bond funds to pay the district’s general operating expenses, causing the district to assume at least $7 million in additional debt.

District 210 operated four high schools that drew students from New Lenox, Frankfort, Mokena, Manhattan, Tinley Park and Orland Park. According to the indictment, one of the factors the district’s seven-member school board considered in renewing Wyllie’s employment contract was the financial performance of the district. In 2009, at the request of Wyllie and with approval of the school board, the district issued $29 million in bonds.

Wyllie represented to the school board and bond purchasers that $10 million of the bond proceeds would be used for capital expenditures, including construction or renovation of the high schools, when in fact Wyllie knew that he would spend the money on the district’s general operating expenses and payroll, the charges allege. Wyllie transferred millions of dollars from a bank account where the district maintained its bond funds to a separate account that the district used for paying general operating expenses.

As a result, the district’s net operating expenditures and cost-per-pupil calculation appeared lower than they actually were, thus fraudulently inflating the district’s financial health, the charges state. Wyllie’s fraud scheme caused the district to assume at least $7 million in additional debt from the bond issuance, on which Lincoln-Way continues to pay interest, the indictment states.

Wyllie retired as district superintendent in June 2013.

Each count of wire fraud is punishable by up to 20 years in prison, while embezzlement carries a maximum sentence of ten years. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.